The Budget and the mood music

The political events of the week do not suggest that the role of charities is likely to form a salient part of the election campaign, writes Stephen Cook

Stephen Cook
Stephen Cook

For charities, the Budget was overshadowed by the mystery of the missing £40m. That sum, known informally as the local sustainability fund, was first pledged last May by the former charities minister, Nick Hurd, who expected that it would be making its first distributions by the end of this month. Since then no convincing explanations have been advanced for its non-appearance.

In the meantime Access, the new foundation for social investment first mentioned by Hurd’s successor Rob Wilson in October, was announced today. This welcome addition to the social investment scene, involving a complex tripartite arrangement between the Cabinet Office, the Big Lottery Fund and Big Society Capital, got off the ground, complete with shiny new website, with impressive rapidity. So why has the local sustainability fund, the consultation on which was completed long ago, got stuck in the machinery? In the end, these things are usually a matter of political will.

The Budget did contain a number of measures to benefit charities, few of them new or of great scope or significance. The Gift Aid Small Donations Scheme was extended so that the amount that can be reclaimed by a charity will rise from £1,250 a year to £2,000, but the crucial question of its off-putting complexity was not addressed. A scheme for the subsidised training of fundraisers in small charities was announced, which brightened the eyes of the Institute of Fundraising, but the details and the sums are yet to be revealed.

There was a pledge that intermediaries will be allowed to play a greater role in reclaiming Gift Aid, VAT refunds for rescue charities were extended to charities that operate so-called blood bikes, and a new authorized investment fund for charities will be set up under the regulation of the Financial Conduct Authority. The largest sums of money came in the sharing out among military charities – as already announced in principle - of the latest Libor fines on the banks: one award of £1m will go to three benevolent charities supporting the intelligence agencies.

In another part of the political forest, the local government minister Kris Hopkins this week reiterated the recent edict of his boss, communities secretary Eric Pickles, that public funding of charities should not be used to lobby councillors, ministers or anyone else. This prompted the response from shadow charities minister Lisa Nandy that existing rules already forbid this, and that he was simply sending " a clear and deeply inappropriate signal that charities should not challenge government policy."

So, with the election six weeks away, what do the week’s events contribute to the political mood music about charities? Firstly, that they are likely to be a box to be perfunctorily ticked rather than a central part of the campaign. Secondly, that the government continues to stress the businesslike, social enterprise model as the way forward for the sector (as would Labour, though perhaps with less fervour). Thirdly, that the Conservatives prefer small charities and benevolent organisations to those that campaign and make a fuss, while Labour are committed to replacing the lobbying act with something that will have a less chilling effect on charity campaigning. No doubt further details will emerge in the near future.

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